On August 14, 2023, the Delaware Court of Chancery approved a $48,500,000.00 settlement secured by Wolf Popper LLP together with other Co-Lead Counsel. The settlement is for the benefit of former stockholders of sports media company MSG Networks, Inc. (former NYSE ticker: “MSGN”), whose shares were extinguished in a 2021 merger with Madison Square Garden Entertainment Corp. (“MSGE”). Under the terms of the merger, stockholders received 0.172 shares of MSGE common stock for each share of MSGN common stock they held.
In approving the settlement, Vice Chancellor Lori W. Will stated that the settlement amount, which provided stockholders with an approximate 8.8% increase to the cash value of the merger consideration, constituted a “great” result and that the resolution was “in all respects, fair, reasonable, and adequate to the Class” given the risks of continued litigation. Vice Chancellor Will further stated “Congratulations on this great result. You should be very proud of the settlement here....Well done.”
The plaintiffs in the consolidated action alleged, among other things, that members of the Dolan family, led by MSGN Executive Chairman and MSGE CEO James L. Dolan, violated their fiduciary duties when they used their control of both companies and their respective boards of directors to effectuate a merger that provided inadequate consideration to MSGN stockholders. The plaintiffs further alleged that the MSGN directors who recommended the merger labored under disabling conflicts of interests and were beholden to the Dolans.
The now-approved settlement, which was reached in principle less than three weeks before trial, followed the exchange of over 1.1 million pages of documents, 43 fact depositions, eight expert reports, four expert depositions, and various motions filed by the parties regarding discovery and pretrial matters. The litigation also received considerable news coverage due to MSGE’s decision to ban all plaintiffs’ counsel from entering its venues, including Madison Square Garden, Radio City Music Hall, and the Beacon Theatre, which drew the scrutiny of regulators and elected officials.
Class members will be paid from the settlement fund following the conclusion of the settlement administration process, which will take several months. Please be patient. Class Members do not have to submit a claim form or take any other action in order to receive payment.
For more information, please visit the settlement administration website at
http://www.msgnstockholderlitigation.com/
The now-resolved case is
In re: MSG Networks Inc. Stockholders Class Action Litigation, 2021-0575-LWW, in the Court of Chancery of the State of Delaware.